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The willing suspension of disbelief: the contract for government and the budget

Codogno, Lorenzo and Merler, Silvia (2019) The willing suspension of disbelief: the contract for government and the budget. Contemporary Italian Politics. ISSN 2324-8823

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Identification Number: 10.1080/23248823.2019.1645997

Abstract

The crucial moment for economic and budgetary policies in 2018 was the agreement between the Lega (League) and the Movimento Cinque Stelle (Five-star Movement, M5s) on the so-called ‘Contract for a Government of Change’, which allowed the formation of a new government following the March general elections. It informed economic policies and especially the first ‘People’s Budget’. It tried to reconcile economic and financial constraints with the parties’ election promises. It was also the start of a rough ride in financial markets, with the government bond spread coming under pressure. The year came to a close with the agreement between the Italian government and the European Commission on 22 December, which avoided the initiation of the Excessive Deficit Procedure and brought renewed calm to the financial markets. The new Italian government purported to deliver on the unrealistic election promises by rolling-back previous pension reforms in favour of a new system, and by delivering the so-called citizen’s income, a basic income plan. However, underlying economic issues remained unresolved and it was hard to detect any coherent growth strategy.

Item Type: Article
Divisions: European Institute
Date Deposited: 21 Aug 2019 15:03
Last Modified: 13 Sep 2019 11:09
URI: http://eprints.lse.ac.uk/id/eprint/101428

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